How did Subaru move from selling only 150,000 cars yearly to over 700,000? You can brainstorm all you want in the corporate board rooms or be smart and ask your owners. That's what former Subaru CEO Tom Doll did. Find out the fascinating answer.
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Subaru was failing in the car business and needed to do something different.
In part 1 of my Subaru series, Tom Doll shared the inspiring journey of how he transformed the small Japanese company, which initially only produced motor scooters, into an automotive powerhouse in America. Check out my first report here to learn more about this remarkable transformation.
In part 2, in an interview with the Car Dealership Guy, Tom Doll explains how they took a struggling Subaru company selling only 150,000 Japanese cars yearly to over 700,000 in America. Here is Tom's fascinating story.
The Car Dealership Guy asks Tom Doll, Can you give us a little bit more behind the scenes of the marketing strategy? It's so tough to break into the automotive market. It's such a saturated market because there are so many players.
Ask your customers.
Tom Doll says, We're talking about how can we be different, what is it that we can do that nobody else can do, and what we did is we actually asked our owners, when you have a Subaru, what do you think about it? They said oh, I love it, oh, it does this, I love it, I love it, I love it, and that's how the whole idea of the love theme started.
That's the audience. Our customers told us that they loved their Subaru, its reliability, its durability, the fuel economy, the utility, and everything about it, so that was the whole Genesis of the idea of the love campaign.
Tell us about how you achieved success with your marketing strategy.
Our cars have always been well received in colder climates because of their all-wheel drive capabilities. That was never really an issue. What the problem was for us was name recognition; we had to get our name out there to make people want to consider purchasing a Subaru vehicle.
I came along in 2006 when I got this job as the CEO and, at the time, as the company's executive vice president and COO. We're sitting around with the marketing gentleman, Tim Mahoney. We're talking about how we can be different, what we can do that nobody else can do, and what we did is we actually asked our owners what you think when you have a Subaru. What do you think about it?
Our customers told us how much they loved our cars.
The whole idea of love is the owners who said that they love their Subaru. It's very difficult to own an emotion. When we first came up with this idea of love, it started with "what makes a Subaru a Subaru."
People doubted it. I had people come up to us at the New York Auto Show or the Detroit Auto Show at the time, and they would say you guys are crazy. There's no way you can brand an emotion like that.
But we had nothing to lose in 2005 and 2006. We're on hard times and trying to figure out how to grow this thing because otherwise, there might not be a franchise, so we're figuring out what we can do to be different. So we tried the love thing. If it didn't work, we would go back and try something different.
When we Googled Subaru Love, there were a lot of different things that came up. We always had the moniker. What makes Subaru a Subaru? We asked ourselves if our all-wheel drive made it a Subaru.
We put love in front of it and said love is what makes Subaru a Subaru, and then we had a genius idea in 2008. That would be our DNA.
If we do this, we will advertise love, and we want the whole brand to be considered love, right? So that's when we came up with the idea of Share the Love.
We took five National Charities at the time. We decided at the end of the year when everybody else was advertising low monthly payments or how much they could get, how cheap they could get the car for with incentives and so forth, we said to ourselves, what if we took $250,000 out of our incentive budget and put it towards this love campaign?
We're going to donate the money and let the customers decide when they come in to purchase a car how they want to divide that money. They could put all $250 into one particular charity, put it into five different charities by splitting it, or decide where the money went.
What were the results?
The results were fantastic, and that's what the Genesis was for it. Then, ultimately, over time, we started to add what we call the love promise activations, where now there's something going on at Subaru every other month.
So we have Subaru Loves to Care in February. Subaru loves the environment in April. Subaru loves to help in June. Subaru loves to learn in August when school starts. The month we're in now is Subaru Loves Pets, and then at the end of the year, we have the super Share the Love event.
How did you create loyal customers? A faithful band of Subaru followers?
What's the goal of our business? Fundamentally, it's essential to get a loyal customer. We want customer loyalty. We want customer retention because if we can keep our customer retention and loyalty high, then we don't have to worry about conquesting (losing customers to another car brand).
Customers will see the value that we're providing and the retailers are providing. That's why it's great when you go into a Subaru retailer and the salesperson's been there for 15 or 20 years.
The customer has now been through three or four car buying cycles with that salesperson, and they know that customer. There's a relationship there, and that's what this business is about. The relationship, and so that's the key fundamentally, is about creating a loyal customer.
We can't do it ourselves. We have to have the retailer you're creating a loyal customer because you show the retailer that you care about their success. They're loyal to us. Yes, they're willing to write that check to spend their time in the community to invest now for a better future.
Our retailers have confidence that our way is good, so it's not always about dollars and cents. Once you get to be a certain amount, you have an obligation to help our local communities become better places. That's why we say to our retailers that it's more than just about selling cars; anybody can sell a car. There are 32 car brands out there, maybe more.
They want to sell somebody a car, but not every one of them wants a relationship with the customer, and that's where we come in. We want that relationship with that customer, so we always say you're more than a typical car dealer. You're a Subaru retailer. I want this concept to be fundamental, and I want to dig one level deeper with our customers.
If you missed Part 1 of my Subaru series: Tom Doll Transformed Subaru Into a Loyal Band of Followers, "The Original Subaru Owners Wanted To Sell Motor Scooters, They Weren't Interested In Cars," Click here.
I am Denis Flierl, a Senior Torque News Reporter since 2012. My 30+ year tenure in the automotive industry, initially in a consulting role with every major car brand and later as a freelance journalist test-driving new vehicles, has equipped me with a wealth of knowledge. I specialize in reporting the latest automotive news and providing expert analysis on Subaru, which you'll find here, ensuring that you, as a reader, are always well-informed and up-to-date. Follow me on my X SubaruReport, All Subaru, WRXSTI, @DenisFlierl, Facebook, and Instagram.
Photo credit: Denis Flierl via Subaru
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